
Staff Meeting in the Snow
With all of the snowfall last Friday, we decided to have our staff meeting outside and got creative with snow creations!
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The Section 125 Premium Only Plan (POP) saves employers and their employees money by reducing payroll taxes. It works by making one simple adjustment in their payroll process – employees pay their portion of the insurance premiums on a pre-tax basis rather than on an after tax-basis.
The Premium Only Plan (POP) reduces employers taxable payroll by reducing employees taxable income. So, both employers and employees pay less in taxes.
IRS-sanctioned Premium Only Plans (POP) were created by the Revenue Act of 1978 and are governed by IRS Code Section 125. With a Premium Only Plan (POP):
Any employer can sponsor a Premium Only Plan (POP)
Regular corporations, partnerships, S corporations, LLC’s, sole proprietors, professional corporations, and not-for-profits can all save money on payroll taxes by establishing a Premium Only Plan (POP).
Who can participate?
While regulations prohibit a sole proprietor, partner, or members of an LLC, individuals owning more than 2% of an S corporation, or their spouse and dependents, from participating in the POP, they may still sponsor a plan and benefit from the savings on payroll taxes.
Begin saving taxes immediately.
You can start your Premium Only Plan (POP) at any time. Plus, you can have a short plan year for the first year, so that future plan years coincide with either your fiscal year or the calendar year.